The most important jobs report of Barack Obama’s presidency came in slightly better than expected on Nov. 2, strengthening his case that the economy is recovering. The Bureau of Labor Statistics reported that nonfarm payrolls rose by 171,000 in October. An influx of jobseekers caused the unemployment rate to rise a tick to 7.9 percent–not a bad sign, because it indicates greater confidence that the economy is generating employment opportunities.
Economists had expected a job gain of around 125,000, according to the median estimate of those surveyed by Bloomberg.
“The labor market is taking baby steps forward,” Scott Anderson, the chief economist at Bank of the West in San Francisco, told Bloomberg before the report’s release.
Not only was the October number better than expected, but the government revised its estimates for August and September employment upward by a total of 84,000. The August increase was revised to 192,000 from 142,000 and the September increase to 148,000 from 114,000.
The BLS managed to release the jobs report on schedule in spite of the devastation wrought by Hurricane Sandy on the East Coast. The agency said the hurricane had no discernible effect on the data.
October was just one more month in a recovery that technically began in June 2009, but it loomed large because the announcement came just four days before the presidential election. There is a high degree of uncertainty to the government’s estimate, making it an iffy indicator of the labor market’s strength. Bloomberg View wrote ahead of the report, “It’s bizarre that the jobs numbers wield so much influence.”
The BLS said that the civilian labor force rose by 578,000 in October. In other words, some people started looking for work but didn’t get jobs. That explains why the unemployment rate increased even though the number of people on payrolls went up.
Employment rose in October in professional and business services (51,000), health care (31,000), retail trade (36,000), leisure and hospitality (28,000), construction (17,000), and manufacturing (13,000).
The number of people employed part-time for economic reasons fell by 269,000. Average hourly earnings went down a penny to $23.58 for all employees on private nonfarm payrolls.
